Answer:
What is Bob’s basis in the warehouse and in the land?
- warehouse basis = $53,571
- land basis = $71,429
Explanation:
since the total appraisal value was $75,000 + $100,000 = $175,000, we must allocate the basis using a coefficient = $125,000 / $175,000 = 0.714285
- warehouse basis = appraised value x coefficient = $75,000 x 0.714285 = $53,571
- land basis = appraised value x coefficient = $100,000 x 0.714285 = $71,429
- total = $53,571 + $71,429 = $125,000 (total purchase price)
Since the transaction price was lower than the appraised value, we must adjust the basis for both the land and the warehouse in the same proportion.
Answer:
$917.996
Explanation:
First, we calculate price:
Price = 5% * 1000 = $50.
At the fifth year, Price = $1000 + $50 = $1050
The price of the Corporate bond is given as:
50/(1+.07) + 50/(1+.07)² + 50/(1+.07)³ + 50/(1+.07)⁴ + 1050/(1+.07)^5
= 917.9960512810481
=$917.996 ---- Approximated
It discourages investment from foreign sources
Answer:
Total equivalent unit 1,425 units
Explanation:
<em>Under the first-in -first out system, to account for the units completed in a period, it is assumed that the opening inventory units are first completed and the balance represents the newly introduced.</em>
<em>Fully worked represents unit of inventory started this this period and completed this period</em>
Fully worked = completed units - opening inventory
Fully worked = 1200 -750 = 450 units
Item Units Equivalent Units
Opening WIP 750 750×50% 375
Fully worked 450 450× 100% 450
Closing WIP 800 800× 75% <u> 600</u>
Total equivalent unit <u>1,425</u>
Note the opening inventory has 50% work done last period so the balance of 50% i.e (100 - 50) is completed this period